In 2020, Martinez determined that a competitor's product would make the New Age Piano obsolete and the patent worthless byDecember 31, 2021. Prepare all journal entries required in 2020 and 2021. (Credit account titles are automatically indented whenamount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)Account Titles and ExplanationDebitCreditAmortization Expense1890618906PatentseTextbook and MediaList of Accounts During 2016, Martinez Corporation spent $155,520 in research and development costs. As a result, a new product called the New AgePiano was patented. The patent was obtained on October 1, 2016, and had a legal life of 20 years and a useful life of 10 years. Legalcosts of $28,080 related to the patent were incurred as of October 1, 2016.(a)Your answer is correct.Prepare all journal entries required in 2016 and 2017 as a result of the transactions above. (Credit account titles are automaticallyindented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for theamounts.)Date Account Titles and ExplanationDebitCredit2016Research and Development Expense155520Cash155520(To record research and development expenses)2016Patents28080Cash28080(To record legal expenses)

The financial transactions are initially recorded in the form of a journal entries.

In 2020, Martinez determined that a competitor's product would make the New Age Piano obsolete and the patent worthless December 31, 2021. Prepare all journal entries required in 2020 and 2021. (Credit account titles are automatically indented wher amount is entered, Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)

In 2020, Martinez determined that a competitor's product would make the New Age Piano obsolete and the patent worthless December 31, 2021. Prepare all journal entries required in 2020 and 2021. (Credit account titles are automatically indented wher amount is entered, Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter8: Operating Assets: Property, Plant, And Equipment, And Intangibles

Section: Chapter Questions

Problem 8.13MCE

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During 2016, Winston Corporation spent $170,000 in research and development costs. As a result, a new product called the New Age Piano was patented. The patent was obtained on October 1, 2016, and had a legal life of 20 years and a useful life of 10 years. Legal costs of $18,000 related to the patent were incurred as of October 1, 2016. Instructions a. Prepare all journal entries required in 2016 and 2017 as a result of the transactions above. b. On June 1, 2018, Winston spent $9,480 to successfully prosecute a patent infringement suit. As a result, the estimate of useful life was extended to 12 years from June 1, 2018. Prepare all journal entries required in 2018 and 2019. c. In 2020, Winston determined that a competitor's product would make the New Age Piano obsolete and the patent worthless by December 31, 2021. Prepare all journal entries required in 2020 and 2021.
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During 2018, Matsumura Ltd. spent ¥170,000 in research costs. As a result, a new productcalled the New Age Piano was patented. The patent was obtained on October 1, 2018, and hada legal life of 20 years and a useful life of 10 years. Legal costs of ¥24,000 related to the patentwere incurred as of October 1, 2018. (Amounts are in thousands.)Required:1. Prepare all journal entries required in 2018 and 2019 as a result of the transactionsabove.2. On June 1, 2020, Matsumura spent ¥12,400 to successfully prosecute a patentinfringement suit. As a result, the estimate of useful life was extended to 12 years from June 1,2020. Prepare all journal entries required in 2020 and 2021.3. In 2022, Matsumura determined that a competitor's product would make the New AgePiano obsolete and the patent worthless by December 31, 2023. Prepare all journal entriesrequired in 2022 and 2023.
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